Prior to the introduction of e-commerce, personalisation has been a service once reserved only for the luxury market. Back then, these companies had a relationship with the elite few and in turn were able to tailor their services to the needs of the individual and charge a premium for it. Today, personalisation has become more a competitive necessity, as consumers are eager for companies to deliver exciting personalised services and brand experiences.
When personal is too personal.
All of this comes at a cost, of course. By getting consumers to share more in-depth personal information – such as mobile phone data, access to record behaviours and capture media consumption habit, there is a strategic benefit for companies to acquire customer information as an exchange for personalised services.
On a computer, consumers are constantly creating digital trails of behaviours with every click and tap. Companies such as Amazon and Netflix have built very successful businesses on the premise of personalised services using these digital trails. Personalisation is enabled and delivered by not only the online merchant, but through a whole back-end infrastructure which includes tracking mechanisms such as IP addresses, cookies, tags and caches, to advertising agents such as DoubleClick who have access to parts or all of the customer information in a particular transaction. By using any part of this data to understand the consumer, these companies are able to provide a superior level of service, one which generates high consumer loyalty and conversion to purchase. It is not hard to see that their investments in infrastructure and technology to track the “digital footprints” are paying off.
And it does not stop there. With the increasing use of smartphones, the amount of personal data generated is exponential. We are creating trails of our presence without even knowing it. Consumers do not even need to tap or view a page, as the mere presence of a smartphone through its mobile signal can create a digital trail that enables companies and brands to connect with them. Additionally, mobile apps create a whole new opportunity to track digital footprints any time, and everywhere.
So what is the trade-off between personalisation needs and privacy concerns?
While concerns for privacy seem to be grabbing industry headlines, it is a matter of asking your nearest and dearest how much information they are sharing (knowing or unknowingly) to realise that people are willing to give up more than one would think. As the assortment of products and services in the marketplace proliferate, consumers often rely on newer technologies, such as interactive decision aids and electronic recommendation agents to filter and condense the variety of options to assist them in product choice decisions.
In this sense, I for one am very grateful. These personalised tools have provided me with product and service suggestions and recommendations relevant to me (and only me) thus giving me this unique experience. For example, Netflix lists movies that I “might like” based on my viewing habits (behaviour), titles I would tend to gravitate to otherwise. Another example is Ocado suggesting offers to products relevant to my past grocery purchases (habit), which I tend to end up purchasing but now with a discount. As a result, I am able to focus on my needs and simplify my life in a world where there is information overload. Additionally, if I register with a website and give out my information, I do so with the expectation that the website will give me a personalised experience in the future based on my profile.
What’s my value exchange?
So, do I give out my personal data willy-nilly? Of course not. In each scenario, the decision to participate in the exchange of my personal data depends on a cost/benefit analysis. Though it sounds complicated and unnecessary, it is rather simple. It is my perceived value from using the personalised services with my privacy concern.
A trusted relationship
If I have had repeated exchanges over time with a particular online vendor which I have grown to “trust” – trust can take a form of reputation in offering or credibility in delivery, it can dispel any privacy concerns that exist in my personalisation exchanges.
Nature of the relationship
There are some instances where the exchange of personal data online will involve a degree of personalisation in the physical world. For instance when I am travelling, it is my preference to choose a particular airline or hotel which can provide me with a degree of personalised service such as being greeted by my name or securing my seating, room and meal preferences. My willingness to exchange personal data increases if it meets the criteria of a trusted relationship.
Understanding the meaning of the exchange
I have a strong willingness to exchange reasonable amounts of personal information in exchange for better services. If there is a compelling value proposition that fits my “belief system”, then I am able to accept that the trade-off is to my advantage. To me, this is the Web based on relevance. Intent-based personalisation personalises the experience for the now, and not the past.
Ever called a friend while walking through a dodgy area alone, just so someone would know if something bad happened? The development of a personal safety app allows me to exchange my personal data to tell my phone when to watch over me. An alternative to a panic-button, Watch Over Me app operates on a simple premise: You tell the app what you’re doing (it has a pre-set list that includes tasks such as walking to your car and meeting someone new) and how long you believe you’ll take to accomplish that task. If you do not report back within that time frame, the app will then, depending on the subscription type you have, send an alert to your listed emergency contacts via Facebook, email, or SMS. It will even time-stamp events and locations for future records.
What can I say? I’m certainly guilty of giving up my home address and credit card information to avoid the pesky retyping of numbers, hah! Though I need to be clear and say, it is without first going through the filters of trust and nature of the relationship before I voluntarily disclose these details. Additionally I would also consider the frequency of this information being used. For example, I have my personal details stored on my Hungryhouse app – which says quite a lot about my work-home life balance. To me, this app is amazing as it puts thousands of live restaurant menus at my fingertips. With several clicks, it is such a convenient way to find a local restaurant, access the menu, and pay for a delivery. Hassle-free, and no fuss.
Internet of Things (IoT)
Ever felt “cheated” when your utility bill arrives and is considerably higher than the previous months even though your day-to-day routine has not changed? Or you are just environmentally-aware and fed up with waste? Intelligent machines such as Smart Meters are being developed to give you near real time information and manage your energy use to get accurate bills.
With power, comes responsibility.
The concept of privacy has considerably changed since the digital revolution, but it continues to evolve and adapt so quickly. The most rapidly expanding area of data is in the provision of personal information that defines us as consumers, but much of this also relates to our expanding and intimate relationship with interactive technology.
With the increased use of technologies like NFC and RFID, apps that track geo-location and online retail sites that capture user data, consumers will likely grow more and more accustomed, and willing, to having their data tracked—so long as they are able to exchange personal information in a more controlled and directed way.
It is clear that business have a responsibility. This willingness to share information represents rich opportunities to reach and connect with consumers in new and exciting ways. Companies can encourage consumers to share more information by educating them about the benefits (via opt in /out) and being transparent about their practices. In the end, consumers will always welcome improving compliance practices and safeguards that make the process more transparent and controllable.